By Alex Kapadia
Michelin are set to hike their tyres prices in a bid to offset the soaring costs of raw materials in 2010.
Global tyres manufacturers have seen world rubber prices rise throughout 2009, but they began to soar this year because of a shortage of supply.
Jean-Dominique Senard, one of Michelin’s three managing partners, said: “..this violent increase is a challenge for the group; it’s a real issue for 2010.”
Speaking at the company’s annual shareholders’ meeting in Clermont-Ferrand, central France, where it has its headquarters, Senard added: “We are going to ensure that sale prices reflect this rise in costs we are experiencing.”
His comments echo Italian rival Pirelli, another major European tyre producer, which said earlier this week it was considering raising tyre prices further to offset raw material costs, including the cost of natural rubber.
Michelin, which suffered a 10 percent drop in sales last year during the economic downturn, said in February when it released full-year results that rising rubber prices and an unclear market outlook made it “extremely vigilant” for 2010.